John Kerry will not privatize Social Security. In case you missed it, since it was mentioned in the debate so briefly, the “gap” that Kerry referenced in Bush’s plan occurs when the working generation, under the Bush plan, would presumably take money out of Social Security for the proposed private investment accounts. Since the working generation pays for the retiring generation, this money re-directed to private investment accounts would result in a loss of funds to support Social Security payments to the retiring generation. If privatizing were eventually to prove successful, the gap would last until the retiring generation for whom there was no money passed away and the private Social Security investment accounts started paying out.
Like all Bush initiatives, privatizing Social Security would produce more of a gap between the “haves” and the “have nots.” A person with a $25,000.00 a year income and two children would not have much to invest, but a person with $100,000.00 would do well if the investment decisions were consistently wise. If not, well, that’s the way it goes in private investment. You win some, you lose some. It wouldn’t really be security at all, just another way to produce more poor people and richer rich people.
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